Is it possible to compress ISO files made from DVD's? My wife and I have a little one on the way and I'd like to back up our library for obvious reasons. :)

edit: Also, it seems as though all my DVD's are 7GB or more. Since I own a 1080p HDTV, would I be better off purchasing the DL (DVD9) discs? I don't know how much quality would be lost if I recorded a movie that is originally larger than 7GB onto a 4.7GB DVD5.